Monday, April 23, 2012

Money Money Money

I’m kind of cheap.

I chalk this up to the way that my parents raised us, not to take anything for granted and not to overly spoil us with lots of material things. I think another big element to this money puzzle is logic. Why would I want to spend more money on something then I need to? When there is an item that I want a lot of times I ask myself “Do I like this (item’s dollar amount) worth?” Basically comparing in my head if I would rather have that cash in my pocket or the item in my hand. Maybe that makes me cheap. I think I’m just being logical. I don’t do that with every purchase but usually when I’m teetering between the good and bad angel on my shoulder.

In college I took a course on personal finance. It was in my last semester and it was one of my favorite classes that I took the whole time I was in college. I went to a small school so a classroom was only about 25-40 students at a time. My professor for that class just lectured. All his lectures were on the things that people always say SHOULD be taught in school. Taxes. Understanding credit cards. Buying a car. Buying an engagement ring. It is safe to say that my professor was kind of cheap too. I don’t really know if cheap is the best word though. We both can be lumped in the category of people that don’t want to give their money up too willingly. The most important lesson that I learned in that class was “no one will ever care as much about your money as you will.” And from what I have observed so far this is totally true. And also a really important reminder to get educated and continue to educate yourself about finance.

I guess I’m a little bit of a nerd, I really enjoy finances and planning and finding new ways to make saving and growing our wealth more interesting. Along the way I’ve found a couple things that work for us. I’m not claiming that these things are ground breaking secrets but they are all finance points that I believe in and have served us well so far.

You can have anything you want but you can’t have everything you want.
I think this makes sense, pretty easy to understand. But so much harder to live. It goes along with the same thought that you can’t eat everything you want but you can eat anything you want and still remain relatively health. It’s about moderation and really listening to what is your priority and what balance you can find between the things you really want and the things you want in that moment.

It is more important to be happy then it is to be rich.
Of course there is always the argument that having money can really help to be in a happier place but in this case but when you get down to it I believe this to be true. There was a period of time when we had moved and money was tight for us. I didn’t understand how it gotten so complicated and over our heads. Did I plan poorly? Why wasn’t it working anymore? There were many days where I thought about money and money issues and stressed day after day. But worrying is like a rocking chair, it gives you something to do but you don’t get anywhere. So I started doing things instead of just thinking about things. I organized our finances, I started focusing on ways to save, editing our budget to what mattered, tried my hand at couponing. The most important thing that I think I did during this time though was learn to appreciate what we had. Even though our situation wasn’t perfect we had a lot and we really were rich in the things that mattered. And it is amazing how once I really started to focus on the good things we had, all the wonderful things that we had to celebrate and feel blessed about, that other things just seemed to fall into place.

I would rather be rich then look rich.
I have never been really into labels. I remember wanting clothes from the mall because it was so much cooler when I was in high school but my mom wasn’t into letting me have just any old thing that I wanted on a whim or silly reason. Boy am I glad she held that line. Don’t get me wrong there are certain brands that I believe do the job better then generic or store brands. One example of this is I love Bare Minerals/Bare Escentuals. I’ve been lazy and bought the drugstore brand mineral powder before and always ended up just going back to the original brand because it was so much better. Quality can be better in the long run. But buying something for the sake of getting to float that label just has never been my thing. I think this goes along with wanting to be rich rather then just look rich. I would much rather have a fat emergency fund in the bank then a new car that I have to pay huge car payments on each month. Just about anyone can purchase things that put them in a higher lifestyle class to give the impression that they are doing well when their credit card bill is actually on life support. I love reading stories about millionaires that continue to drive older model cars and still use coupons and deals. To me this really says that finances and money are a lot more about a frame of mind then they are about actual numbers. This is good news for me since numbers and I don’t go well together but being able to be creative and thrifty do seem to come much easier to me.

Coupons and deals are only deals if you need it/ planned on it.
I’ve never shopped on Black Friday. I know a lot of people do and find great deals that way. That is awesome. For you. It’s not for me. I don’t like going to Walmart on a regular Saturday because there are usually so many people there. I just don’t enjoy that. I do get a kick out of the ads that come out and tell you “You can save $300 when you buy this (whatever item)”. You are only really saving if that item was already on your list of things that you need or need to replace recently. If you weren’t planning on buying it but now because its on sale, and therefore on your mind, you go and get it how is that saving? Saving is keeping money in your pocket.

I’ve tried couponing and it isn’t something that I seem to be all that good at. But I keep trying. One down side of couponing that I have noticed though is the habit of buying an item when its on sale because its on sale. When you have a coupon for a candle and all the sale stars align and you can get it for $1, again, is it really a deal if you wouldn’t normally buy it? Yes, I’m getting something at a lower cost but if I normally do without it that is always going to save me more. It all comes down to the value.

Nobody cares more about your money then you do.
To me this is the most important piece of financial advice. Which is why I’m repeating it yet again. There are times when you need to consult people that know more then you to get farther and become better with your finances. I read a lot of finance blogs and for the first time we hired a CPA to do our taxes this year. Just keep learning.

When things are going well and your bank account is in a good place I think it is easy to let your money go into cruise control. When things with money were tight and stressful for us it forced me to really look at the numbers and figure things out. I’m so grateful for that and for that opportunity to become more interested and more involved. While it meant taking a couple extra heart burn pills for awhile I can’t even begin to imagine the money we saved because of the lessons that we learned through that process. It was the silver lining, the rain after the rainbow moment.

These are just some of the lessons that I have dug up and realized in trying to educate myself more. I enjoy learning and finding new and better ways to do things. It is a process though and not really something that you ever get to a point and just stop.

What financial tips do you live by or feel help you to manage your finances to the best of your ability?

2 comments:

Good post, thanks for all the tips/reminders. Since going back to work after Henry was born we've just been living off of Josh's paycheck, and all of mine is going towards student loans and childcare. We're kicking ourselves for not doing this last year, but I just have to keep reminding myself that at least we're doing it now! I also coupon, and when I first started doing it I totally fell into the category of *it's so cheap! buying it!* and ended up with some stuff we never used. now i've gotten in a groove and use couponing for just stuff we need, and its great. Especially when I put more time/effort into it, it can really pay off. Anyways, we're definitely trying to be smarter with our money now. What are some of the finance blogs/websites you look at?

It sounds like you guys have a good plan going now! That is what matters the most! Some of the blogs that I really like are Wise Bread, Budgets Are Sexy, Money Under 30, Dollars and Roses & Good Financial Cents.